How can salary benchmarking help you improve company culture?

1 Define your culture

Before you can benchmark your salaries, you need to have a clear understanding of what kind of culture you want to create and maintain in your organization. Culture is the set of values, beliefs, and behaviors that shape how people work and interact in your company. It influences everything from employee engagement, productivity, innovation, customer satisfaction, and reputation. To define your culture, you need to identify your mission, vision, and core values, and communicate them clearly and consistently to your employees and stakeholders.

2 Choose your benchmarks

Once you have defined your culture, you need to choose the appropriate benchmarks to measure your salary levels and practices against. You can use different sources of data, such as surveys, reports, online tools, or consultants, to gather information about the pay ranges and structures of other employers in your industry, region, or sector. However, you should also consider the cultural fit of the organizations you are comparing yourself with. For example, if your culture is focused on innovation and collaboration, you might want to benchmark yourself against companies that have similar values and practices, rather than those that are more traditional or hierarchical.

4 Implement the changes

Based on your analysis, you need to implement the changes that will help you close the gaps and improve your salary levels and practices. You might need to adjust your pay ranges, create or revise your pay scales, introduce or modify your bonus or commission schemes, or enhance or diversify your benefits package. You should also communicate the changes clearly and transparently to your employees and stakeholders, and explain how they support your culture. For example, if your culture is centered on learning and development, you might want to offer more opportunities for training, coaching, or mentoring, and link them to your pay progression.

5 Monitor the outcomes

Finally, you need to monitor the outcomes of your salary benchmarking process and evaluate its impact on your culture. You should track and measure indicators such as employee satisfaction, retention, performance, engagement, and alignment with your values. You should also solicit feedback from your employees and stakeholders, and listen to their opinions and suggestions. You should also review and update your salary levels and practices regularly, and keep an eye on the market trends and changes. By doing so, you can ensure that your salary benchmarking process is not a one-time event, but a continuous and dynamic practice that helps you improve your company culture.

6 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?